Avio (AVIO) Q3 2024 earnings summary

Executive summary

• Successfully completed the last Vega flight and prepared for Vega C's return-to-flight, scheduled for December 3, 2024, carrying the Sentinel-2C satellite for the European Commission.

• Entered a partnership with ACMI to develop a solid rocket motor production facility in the USA, with site selection targeted by mid-2025 to support future growth in U.S. defense contracts.

• Revenues and profit increased year-over-year, driven by defense propulsion and technology development projects.

• Order backlog reached a record €1.348 billion, nearly three times annual revenues, providing strong medium-term visibility.

• Defense business is becoming a more significant part of the portfolio, with a tenfold increase in order backlog since 2019 and further growth expected from the CAMM-ER Polish contract.

Financial highlights

• Net revenues rose 24.6% year-over-year to €277.9 million for the first nine months of 2024, driven by defense propulsion and technology development projects.

• EBITDA Reported increased 38.5% to €12.1 million; EBITDA Adjusted up 12.3% to €15.9 million.

• EBIT Reported improved to -€0.7 million from -€3.5 million; EBIT Adjusted rose to €3.1 million.

• Net financial position as of early October returned to a positive €30 million, after a decline to -€0.1 million due to seasonality and cash outflows to subcontractors.

• Order backlog stable at €1,348 million, with over €260 million in new intakes, mainly from defense propulsion and Ariane programs.

Outlook and guidance

• 2024 guidance confirmed: order backlog expected between €1.5 and €1.6 billion (10–15% growth vs. 2023), revenues between €370 and €390 million, EBITDA Reported between €21 and €26 million, adjusted EBITDA between €28 and €33 million, and net income between €6 and €10 million.

• Anticipates a busy 2025 with up to four Vega C and six Ariane 6 flights.

• Backlog roll-out anticipated to unlock production and economies of scale.